Should buyer get her own appraisal?

At Bankrate we strive to help you make smarter financial decisions. While we adhere to strict , this post may contain references to products from our partners. Here’s an explanation for

Dear Real Estate Adviser,
I am interested in buying a home. Is it best to get my own appraiser?
— Donna F.

Dear Donna,
Absolutely! You cannot rely on the seller’s appraisal as a legitimate valuation tool. Not to disparage the honest appraisers who comprise the vast majority of the profession, but some appraisers tend to exaggerate the value of their client’s homes based on that client’s agenda. These folks are called “number hitters.”

Besides, unless you’re paying cash or slapping down a healthy sum such as 50 percent for a down payment, your mortgage loan may hinge on the results of a bank-ordered appraisal. That’s how your lender can be satisfied that its investment is covered, and that the house you’re buying is worth what you’re paying, just in case you default. By the way, if your lenders allow you to choose your own appraiser but you pick one who isn’t familiar to them, the results may be subject to a lender review before they can be accepted. That could slow down the whole process.

Unless your agent had a spotless reputation, don’t go along with his or her suggestion of appraisers. Some agents have been known to recommend appraisers who will inflate or deflate a home’s value just to grease a sale. Moreover, your appraiser should be experienced with the type of property you are considering and have a deep knowledge of the local market, and he or she should have access to such data sources as the Multiple Listing Service, or MLS, public records, tax authorities and the like. In many cases, however, records can lag behind what’s really going on in the market — so you will want an updated “market reality” ethic woven in as well, factoring in nearby short sales and foreclosures as well as conventional sales.

These are all the more reason to screen appraisers thoroughly. You should also know an appraisal will likely not include such things as aboveground pools and storage sheds because they are not permanent structures. Additionally, finished basements may be calculated separately. Some astute and thorough appraisers have been known to save buyers five-figure sums.

Appraisals cost anywhere from $200 to $500. If your appraiser is on the far low end, you may get what you pay for — and a potentially troublesome inaccuracy based on a less-than-thorough property examination.

If there are other buyers interested in the property, and you feel compelled to make an offer before you get your appraisal, then be sure to put language into the contract saying your bid is contingent on your appraisal being equal to or greater than the selling price. Another point: You aren’t obliged to disclose the details of your appraisal to the seller, but would be advised to do so if the number falls short and you want to wiggle out of the contract. On the other hand, you would be especially wise to keep your appraisal number to yourself if it’s above the sale price and (or) your offer.

Good luck in your home purchase.

Ask the adviser

To ask a question of the Real Estate Adviser, go to the “Ask the Experts” page and select “Buying, selling a home” as the topic. Read more Real Estate Adviser columns and more stories about mortgages.

Bankrate’s content, including the guidance of its advice-and-expert columns and this website, is intended only to assist you with financial decisions. The content is broad in scope and does not consider your personal financial situation. Bankrate recommends that you seek the advice of advisers who are fully aware of your individual circumstances before making any final decisions or implementing any financial strategy. Please remember that your use of this website is governed by Bankrate’s Terms of Use.